The Honolulu City Council voted on Wednesday to release confidential legal advice about a bill that sought to slow the conversion of hotel rooms to condominiums, sparking protest from one council member who argued that the timing of the release was aimed at influencing the race for the City Council District 6 seat.

Bill 16 was sidelined in April by Councilwoman Carol Fukunaga, angering Unite Here Local 5, a union representing hotel workers, which had strongly backed the bill. The union has attributed the loss of hundreds of jobs to the hotel-condo conversions, particularly in Waikiki.

Union members attacked Fukunaga for deferring the bill, accusing her of being in the pocket of Waikiki developers.

But the release on Wednesday of two opinions by the city’s corporation counsel, Donna Leong, supports Fukunaga’s past claims that Bill 16 was legally flawed. 

Honolulu City Council

Honolulu City Council members meet Wednesday.

Sophie Cocke/ Civil Beat

Leong argued that the measure, which would require companies to obtain a permit before transforming more than 20 percent of their hotel rooms into condo or time share units, would be preempted by state and federal laws related to employment, land use and zoning and condominiums.

Leong also argued that the City Council doesn’t have the power to order the city’s Department of Planning and Permitting to enforce the measure.

“Pursuant to the charter, only the mayor has the authority to assign new duties and functions to departments of the executive branch,” she wrote. “The City Council does not have the authority to designate the implementing agency.”

Leong also provided extensive background information on the topic in an opinion she submitted to the council in March, citing her “extensive experience and legal practice in the field of hotel and resort development and operations.”

Before being tapped by Mayor Kirk Caldwell to be the city’s top attorney, Leong worked as a senior vice president and chief legal officer for Outrigger Hotels Hawaii, earning from $800,000 to $899,999 annually, according to her financial disclosure statement filed with the city.

In a May opinion, Leong also provides a legal analysis of a San Francisco moratorium on condominium conversions, that supporters of Bill 16 had hoped to replicate. However, Leong concluded that the state of Hawaii hadn’t afforded Honolulu the same powers to regulate conversions.

Fukunaga said that she pushed to have the information released to help come up with solutions to the problem of job losses in Waikiki.

“We wanted to make those available to the proponents of the measure so that we could find ways of further addressing the concerns they had raised,” Fukunaga told the media after the vote. “And if some of the approaches they had used in Bill 16 were not appropriate, this gives us a means of engaging in further discussions on what might be in the city’s scope of jurisdiction.” 

Councilman Breene Harimoto strongly objected to the release of the opinions, suggesting that they were geared toward helping Fukunaga in her re-election bid. There were also questions about whether the council violated the spirit or letter of the Sunshine Law in how it proceeded with the vote.

Political Fight

Bill 16, introduced by Councilman Ron Menor in March, was in response to growing concerns among hotel workers that their jobs were being threatened by the conversion of hotel rooms to condominium units, which require less maintenance.

Local 5 said that more than 900 union workers across the state had lost their jobs in recent years, in part due to the conversions. 

Fukunaga, chair of the Public Safety and Economic Development Committee, deferred the measure in April, citing concerns about its legality. At the time, she indicated she would revive the bill in some form. In an opinion piece for Civil Beat, she wrote, “I can understand and sympathize with those who might think that the deferral of Bill 16 on April 22 by my City Council Committee on Public Safety and Economic Development signal’s the bill’s demise. Nothing could be further from the truth.”

But Fukunaga never revived the bill and told Civil Beat on Wednesday that she still has no intention to do so.  

“I don’t think I would go back to that bill,” she said. “I would look to find alternative approaches.”

Discussion of the bill didn’t end when Fukunaga deferred Bill 16. Local 5 fought back, running its own candidate, union leader Joli Tokusato, against Fukunaga in the City Council District 6 race. The union’s super PAC, AiKea, which describes itself as a progressive, grassroots movement, says it knocked on about 30,000 doors to drum up support for Tukusato. It also mailed out flyers criticizing Fukunaga for deferring Bill 16.

Tokusato lost in the August primary to Fukunaga and Sam Aiona, who are in a run-off election Nov. 4. Fukunaga received 43 percent of the vote, Tokusato 18 percent. 

Neither Local 5 or AiKea have thrown their support to Aiona, but both continue to criticize Fukunaga for deferring the measure. 

Harimoto suggested that the decision to release the corporation counsel’s opinions — six months later — was for political reasons.

“I fear that this council will get caught up in playing politics,” he said prior to the vote. “The timing is ill-advised, to be released just before the general election. 

Harimoto said that releasing the opinions adds to public distrust of the council, especially on the heels of a recent city Ethics Commission investigation that fined former Council member Romy Cachola $50,000 for campaign spending violations and the abuse of city transportation funds. Additional questions have also been raised recently about current and former council members and whether they illegally accepted expensive meals from people who had business before the council. 

“Public confidence in elected officials and government in general is being eroded,” said Harimoto. “Everything we do and say must be to instill confidence and trust in not only us but in government and I fear that what we are doing today does exactly the opposite.”

Fukunaga said after the council meeting that she disagreed with Harimoto’s take on the release of the opinions, noting that Local 5 had been urging just that.

“If anything, I would come out on the side of more information disclosure,” she said. “This is something that the proponents (of Bill 16) had asked for from day one.”

Sunshine Law

Wednesday’s proceedings were also tinged with some awkward moments about whether the City Council violated the Sunshine Law. 

The council voted to go into private, executive session to consult with the city’s corporation counsel about whether or not to disclose the opinions. 

But the council only provided a vague explanation about the meeting’s purpose: “To consider the waiver in two separate instances of the attorney-client privilege for confidential communication with the council’s attorney.”

There was no mention of Bill 16 or hotel-condo conversions.

When council members returned to the chamber they tried to then take a public vote on disclosing the opinions, raising protests from Harimoto. 

“I find it hard to believe that we are discussing something that the public won’t know what the topic is,” he said. “That is a travesty of justice in my mind.”

Eventually, the council voted to disclose the subject matter of the executive session — Bill 16 — and the council voted to release the legal opinions. Harimoto voted no, while council members Stanley Chang and Menor expressed reservations. 

You can read the corporation counsel’s legal opinions below: 

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